Business College Curriculum Emphasizes Ethical Issues

For a while, it seemed as if every newspaper that came out had a different business scandal: executives spending shareholders' money on toga parties; chief executive officers borrowing money set aside for employee pensions and never paying it back; accounting firms turning a blind eye to their clients' wrongdoing; corporate boards not exercising their oversight responsibilities.

The headlines have given professors in the Tippie College of Business opportunities to emphasize standards of business ethics and ethical dilemmas their students may face after graduation.

Nancy Hauserman, the college's associate dean of the undergraduate program, says that business professors ask students to think about the ethical dimensions of responsibility every day--an emphasis that isn't new. Since the 1970s, standards by which business colleges are reaccredited have required course work in business and society or social issues in management.

"We teach the issues behind those headlines and ask (students) to think about not only how they would make decisions but also why they make certain decisions under various circumstances," Hauserman explains.

Questions of ethics are addressed in all required undergraduate courses, such as Introduction to Accounting and Introduction to Marketing. The college also offers some courses that deal specifically with ethical issues, such as Law and Ethics.

Lon Moeller, associate professor of management and organizations, is teaching an honors section of Introduction to Law. The recent headlines have provided him with a teaching tool.

"I use the Enron, Martha Stewart, and Tyco case studies to get the students' attention," Moeller says. "It's easy to say that ethics is an abstract idea, but now you have celebrities who once were on the cover of Business Week on trial. Their fall gets the students' attention."

Moeller says he tells his class that some of the accused executives have reputations for having strong personal ethical standards.

"Former Tyco chief executive Dennis Koslowski is a very religious, well-read man whose personal standards of ethics are strong. What happened in the Tyco business culture that made him go wrong?" he asks. "It's easy to say, That wouldn't be me,' but most of those executives are MBAs, and no doubt they once said they wouldn't do those things, too. How were they corrupted by power?

"If you teach ethics directly, students wonder if it should be part of the curriculum. But if you ask them to examine their own ethical standards in the context of these case studies, it's relevant to them."

Lynn Pringle, professor of accounting, teaches a required course, Professional Orientation Seminar Series, which features a session for discussing ethics. He also teaches an auditing course that uses a case book made up entirely of fraud cases that auditors have dealt with.

"Ethics is an issue that comes up frequently in Negotiations," she says. "A negotiation can create the opportunity for short-term gain at the expense of a long-term relationship. Negotiators often have to balance a mixed-motive situation--trying to achieve the best for themselves while also considering the needs of the other person."

When people focus only on the short-term benefit for themselves, they're more likely to be tempted to engage in questionable tactics, she says.

"When you look at Enron or WorldCom or the others, you see they were often under pressure to come up with the best quarterly numbers," Boles adds. "This gave them a short-term incentive to lie. It's easy to get a good deal by misrepresenting the facts, but when people learn about the misrepresentation, your reputation is damaged for the future."

Hauserman says business ethics are addressed in the college's extracurricular activities as well.

"Two years ago, thanks to a gift from an alumnus, we were able to send two students to an ethics conference at West Point," she says. "This year, we sent more students to various conferences addressing leadership and ethics. It is a great opportunity for the students and for us--since we learn what they learn."

Students also have formed a chapter of the Optimist Club to do community service, Hauserman notes, and most student organizations in the college also work on community projects. In addition, several courses in the undergraduate curriculum include community service or service learning projects.

Several years ago, the business college became the first college at the University to enact an honor code. The code was developed by students. Today, each student applying for admission to the college signs a document accepting the honor code provisions, which include accepting personal responsibility to uphold ethical standards in academic endeavors, accepting cultural differences and treating all individuals with respect and dignity, and setting a standard for ethical behavior.

Hauserman says she believes students are interested in hearing about and discussing ethics issues.

"They are not naïve," she says. "They have no illusions about what is out there waiting for them. I don't know if they are worried, but I know they are interested."